WILMINGTON, Del. and WASHINGTON, D.C. – Global alternative asset manager The Carlyle Group and DuPont have signed a definitive agreement whereby Carlyle will purchase the DuPont Performance Coatings (DPC) business for $4.9 billion in cash. The transaction is expected to close in the first quarter 2013, subject to customary closing conditions and regulatory approvals.
DPC is a global supplier of vehicle and industrial coating systems with 2012 expected sales of more than $4 billion and more than 11,000 employees. The investment will be funded with equity from Carlyle Partners V and Carlyle Europe Partners III.
“DuPont Performance Coatings is a leader in the automotive and industrial coatings sectors with world-class products and customer service. The business continues to grow and deliver solid results. After a careful review, however, we have determined that DPC’s full growth potential would be best realized outside DuPont and through the sale to Carlyle,” said DuPont Chair and CEO Ellen Kullman. “This transaction is consistent with our vision to be the world’s most dynamic science company and long-term strategy of driving competitive advantages in agriculture and nutrition, advanced materials and biotechnology, which represent high-growth, high-margin opportunities.”
Kullman stressed that DuPont remains committed to serving the automotive industry. Following the closing of this transaction, DuPont will generate more than $3 billion in sales of advanced materials to the auto industry.
“We will continue to work closely with automotive customers to apply our science-powered innovations related to light weighting of vehicles, revolutionary and environmentally friendly refrigerants, biobased seat fabrics and headliners and next-generation biofuels,” Kullman said.
According to Mike Bennett, North American marketing manager for DuPont Performance Coatings, Carlyle’s acquisition of the business will allow DPC to meet its future growth targets.
"This allows us to really focus on our marketplace, allows us to reinvest the funds back into the market with the intent to grow," Bennett said. "Carlyle has indicated that they are excited to help us meet our growth potential. With the capital investment we’re going to get from that, that is our intent."
Bennett also confirmed that DPC’s current management team will remain in place, ho the brand name will change.
"Over a period of time the brand name will transition to something else but the products will remain available; it will just be under a different logo at some point," Bennett said.
Greg Ledford, Carlyle managing director and head of the Industrial and Transportation team, said, “DuPont Performance Coatings is a successful business with attractive market positions, next-generation technology and established brands. Through targeted investments we will support DPC’s product development and growth objectives as it transitions to a stand-alone company. We look forward to working with management to fully realize DPC’s great potential.”
Gregor Böhm, managing director and co-head of Carlyle’s Europe Buyout team, added that Carlyle looks forward to building on DPC’s strong market presence to accelerate growth in emerging markets, particularly in China and Brazil.
Carlyle’s other industrial and automotive investments include Allison Transmission, Hertz and PQ Corp., as well as recent commitments to invest in Hamilton Sundstrand Industrial, Sunoco’s Philadelphia refinery and regional rail freight operator Genesee & Wyoming.
